REG - DSW Capital PLC - Trading Update

DSW CapitalAnnouncement

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RNS Number : 7449W  DSW Capital PLC  16 March 2026

 

16 March 2026

 

FY26 TRADING UPDATE

 

DSW Capital, a profitable, mid-market, challenger professional services
platform and owner of the Dow Schofield Watts and the DR Solicitors brands,
announces the following trading update for the year ending 31 March 2026
("FY26").

The Board reports that, having generated double digit growth at DR Solicitors
in FY26 and trading across the network remained steady, the outbreak of war
with Iran has severely impacted M&A activity in the UK, with many deals
the Group expected to complete in March being aborted or postponed until the
long-term economic ramifications of the war are established.

 

March is traditionally an important month for M&A completions, ahead of
the tax year end. While the Group has continued to deliver on its strategic
drive to diversify away from a historic reliance on M&A, achieving Revenue
growth of c.11% at DR Solicitors in FY26 to date, March currently remains a
critical month for the business in terms of full year outturn. Following the
rapid and significant drop off in M&A activity, the board now expects to
report Total Income of c.£6.2m, Adjusted EBITDA of c.£1.6m and Adjusted
profit before tax of c.£1.3m for FY26.

 

Our cash reserves remain strong with cash of £1.4m at 28 February 2026 and
Net Debt of £0.5m. This is after £1m loan repayment of the £3.0m OakNorth
Bank revolving credit facility, drawn down fully to part fund the acquisition
of DR Solicitors, and £0.8m dividend payments across October 2025 and January
2026.

 

Shru Morris, Chief Executive Officer said:

 

"Whilst it is very disappointing that the robust performance of FY26 has
stalled, the Board's strategic aim continues to focus on growing the business
and building a resilient and diversified group of licensee businesses. The
acquisition of DR Solicitors and its subsequent growth, reducing the Group's
dependency on M&A activity significantly, demonstrates this strategy in
action.

 

"Our efforts remain concentrated on attracting additional licensees and
consultants, whilst we are also pursuing new business at DR Solicitors, which
continues to grow stronger since its acquisition.

"The Group remains profitable and cash generative, despite the current
geo-political and economic uncertainties, with a strong pipeline of
diversification opportunities in its sights and will announce a full trading
update post year end, in May 2026, in line with its usual timetable."

 

Definitions:

 

Adjusted EBITDA - Adjusted EBITDA is defined as adjusted profit before tax
adjusted to add back impairment of loans due from associated undertakings,
finance costs, depreciation, amortisation and deduct finance income.

 

Adjusted profit before tax - Adjusted profit before tax which is defined as
profit before tax adjusted for items not considered part of underlying
trading, which in the current and prior period represents share based payments
and amortisation of intangible assets recognised on acquisition accounting, is
a non GAAP metric used by management and is not an IFRS disclosure.

 

Network Revenue - Network Revenue is defined as total revenue earned by
licensees and DR Solicitors, as opposed to total revenue reported by the
Company.

 

Total income - Statutory Revenue from DSW licensees and DR Solicitors plus
share of results of associates

 

Enquiries:

 

 DSW Capital                                                 Tel: +44 (0) 1928 378 100

 Shru Morris, CEO

 Pete Fendall, CFOO

 Shore Capital (Nominated Adviser & Broker)                  Tel: +44 (0)20 7408 4090

 James Thomas/Mark Percy/George Payne (Corporate Advisory)

 Rawlings Financial PR Limited                               dswcapital@rfpr.co.uk (mailto:dswcapital@rfpr.co.uk)

 Cat Valentine                                               Tel: +44 (0) 7715 769 078

 

About DSW Capital

 

DSW Capital, owner of the Dow Schofield Watts and DR Solicitors brands, is a
profitable, mid-market, challenger professional services network with a cash
generative business model and scalable platform for growth. Originally
established in 2002, by three KPMG alumni, Dow Schofield Watts is one of the
first platform models disrupting the traditional model of accounting
professional services firms. DSW Capital operates licensing arrangements with
its businesses and has over 130 Fee Earners across 12 offices in the UK. These
businesses trade primarily under the Dow Schofield Watts and DR Solicitors
brands.

 

DSW Capital's vision is for our brands to become the most sought-after
destinations for ambitious, entrepreneurial professionals to start and develop
their own businesses. Through a licensing model, DSW Capital gives
professionals the autonomy and flexibility to fulfil their potential.

 

Being part of the DSW Capital group brings support benefits in recruitment,
funding and infrastructure. DSW Capital's challenger model attracts
experienced, senior professionals, predominantly with a "Big 4" accounting
firm or "Magic Circle" legal background, who want to launch their own
businesses and recognise the value of DSW Capital's brands and the synergies
which come from being part of the network.

 

DSW Capital aims to scale its agile model through organic growth, geographical
expansion, additional service lines and acquisitions. The Directors are
targeting high margin, complementary, niche service lines with a strong
synergistic fit with the existing network.

 

 

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